The Baltimore Sun, by Gary Cohn and Will Englund

By Will Englund and Gary Cohn

Sun Staff

Raul Mendoza knew that scrapping ships was dangerous, knew about the smoke and the fumes and the accidents. He'd worked in Baltimore, where asbestos clouded the air, and North Carolina, where oil spilled into a river, and California, where workers were told to lie to government inspectors.

But he needed a job. So, on Dec. 22, 1995, in Brownsville, Texas, he climbed into the hold of the USS Yukon, an old Navy tanker. Working in total darkness without safety equipment, he walked across a girder. Then came the scream.

Mendoza had fallen 30 feet into a tank, straddling a cross beam in a blow that split his pelvis. He flipped off the beam and landed on his chest. He was pleading for help. Untrained in shipboard emergencies, rescuers took three hours to extract him. By Christmas Eve, he was dead.

Raul Mendoza is just one of the casualties of a little-known industry called shipbreaking. Spurred by the Navy's sell-off of obsolete warships at the end of the Cold War, the business has grown up overnight in some of America's most economically depressed ports. And almost everywhere the industry has arrived, harm to human health and the environment has followed.

A yearlong investigation by The Sun has found:

• Workers have been toiling in air thick with asbestos dust. In Baltimore, laborers scrapping the USS Coral Sea ripped asbestos insulation from the aircraft carrier with their bare hands. At times they had no respirators, standard equipment for asbestos work. Inhaling asbestos fibers can have slow but lethal consequences, as men who built the ships now being torn apart have learned. Tens of thousands of former shipyard workers in Baltimore and elsewhere have died of asbestos-caused diseases.
• Mishandling of asbestos has been covered up. In Terminal Island, Calif., 20 laborers were fired when they told federal investigators how asbestos was being improperly stripped from Navy ships. In Baltimore, workers were ordered to stuff asbestos into a leaky barge to hide it from inspectors.
• Laborers with little training, supervision or equipment have been killed or maimed. Like Raul Mendoza, workers have been victimized in falls, explosions and accidents that could have been prevented.
• Dangerous substances from scrapped ships have polluted harbors, rivers and shorelines. A scrapyard along the Northeast Cape Fear River in Wilmington, N.C., was contaminated by asbestos, oil and lead. "That site looked like one of Dante's levels of hell," says David Heeter, a North Carolina assistant attorney general.

Ship scrappers frustrate regulators by constructing a maze of corporate names and moving frequently. The Defense Department has repeatedly sent ships to scrappers who have records of bankruptcies, fraud, payoffs to government inspectors, and environmental and safety violations.

The Navy and the Defense Department make no serious effort to oversee the scrapping, even though the Navy retains ownership of the vessels. Until recently, only one inspector with little training and experience kept watch on scrapping operations for the entire country. Concerned about his safety, he refused to board the Coral Sea on one visit; the next day, a deck plate collapsed under a worker, leaving him maimed.

Cutting corners

Workers, mostly Mexicans, often have to pay kickbacks to get their jobs and are sometimes cheated of their pay. Unable to speak English or read warning signs, they have no one to turn to with complaints. "They look for us first because we don't know the law," says Juan Chavez. "If the boss or foreman says you have to do something, what can we do?"

Now, the problems threaten to get worse as the Navy and its sales agency, the Defense Reutilization and Marketing Service, accelerate the scrapping program, with 111 vessels designated for breakup.

The Navy's downsizing promised to be a bonanza for the dozen or so shipbreakers who have opened yards since 1991. For amounts ranging from about $15,000 for a destroyer to more than $1 million for an aircraft carrier, they buy the rights to Navy ships, then sell the salvaged metal. They run lean operations, and their pattern of cutting corners to ensure a profit has often proven disastrous.

Because of environmental violations and other issues, the Navy has had to take back 20 ships from yards in North Carolina, Rhode Island and California in the past 14 months. Of 58 ships sold for scrapping since 1991, only 28 have been finished.

"You've had problem after problem," says David Peck, a Richmond shipbreaker who is one of the few voices calling for reform. "How many fatalities and environmental disasters do you have to have?"

Faced with a scrapping program that clearly has been a failure, the Navy has yet to find a satisfactory solution. It could break up its old ships in Navy yards, as it does with nuclear vessels. It could ask Congress to subsidize the scrapping so that reputable private companies would dismantle them properly.

But what the Navy appears most likely to do is send its ships to South Asia. In recent years, the global shipbreaking business has migrated to India, Pakistan and Bangladesh, where labor is cheap and regulation virtually nonexistent.

While American scrapyards employ hundreds of workers and primarily dismantle U.S. Navy ships, tens of thousands labor in the industry in South Asia, breaking up everything from Russian destroyers to Greek freighters to Japanese tankers.

In Alang, India, the world's busiest scrapping site, 35,000 workers tear ships apart on a beach under conditions far worse than any seen in the United States. Deaths or crippling accidents are everyday occurrences. The sea is foul with asbestos, oil, toxins and human waste. Workers live in makeshift huts in a colony rife with disease.

Until now, U.S. naval vessels have been dismantled at home to ensure that dangerous materials are handled properly, that warships not fall into the wrong hands, and that ships on which American servicemen fought and died be treated with dignity. But recently that policy was quietly dropped.

Even though the Navy would risk criticism for exporting its ships laden with hazards to the Third World, the move would generate more revenue because of the higher prices South Asian yards pay for old ships. And, perhaps more important, it would allow the Navy to send its scrapping problems far away from American ports.

Along the Texas border

The Texas border town of Brownsville, convenient to Mexican steel mills and Mexican labor, is the nation's shipbreaking center. On the Rio Grande, Brownsville is a transit point for drugs and laundered cash as well as men and steel. Young men coming out of the Mexican countryside, desperate for any kind of job, settle in the "colonias" in the dry flatlands by the port. Over the past quarter-century, more than a dozen scrapyards have come and gone.

Santiago Martinez, now 64, remembers the first day he showed up at a scrapping company called Transforma. The boss handed him a hard hat and some shoes (the cost of which was deducted from his pay) and told him to get to work.

The boss, Martinez said, explained the job this way: "He told me, 'Give me a piece of the ship. Cut it.'"

It's hot work in one of the hottest places in the country. The cuttingtorches burn with a sort of back-of-the-throat roar. Swinging cranes lift large pieces of deckhouse off the ships. Sparks fly where steel is being burned, and an acrid, choking smoke billows up when a torch sets off insulation or oil or something else flammable. The men on board ships work at times in near-total darkness and suffocating heat.

"You'd go home you'd cough and your whole chest was hurting all the time," said Jorge Corpus, 22. "You'd blow your nose and black stuff would come out from all the smoke you'd be inhaling all day long."

If the building of a ship is a case study in planning and precise execution, shipbreaking is just the opposite.

Ships are slashed and burned as workers cut out metal to be resold as scrap; eventually, they are hacked down to the keel. Smoke-stained junk is strewn everywhere.

On board, workers find pipes and boilers shrouded with asbestos. PCBs, linked to cancer, are in everything from electrical insulation to ventilation gaskets to fluorescent lights. Lead-based paint covers the hull plates. Toxic chromates slosh around in ballast tanks.

"This is a dirty industry, you know," said Emilio Sanchez, a longtime buyer of government ships. "It's not an ice cream factory."

It's dangerous, too. The experience of one yard, International Shipbreaking Ltd. in Brownsville, illustrates the hazards of shipbreaking. Two men were killed there within a year.

In December 1995, Raul Mendoza got work at International after stints in Baltimore, Wilmington, N.C., and California.

A slight but muscular man with a dark mustache, he didn't like the dangerous work. But he had a family to support in Brownsville, and his parents in Matamoros, Mexico, needed help, too.

Mendoza's family said that he was hired at $250 a week, but had to pay a weekly $50 "mordida," or kickback, to Guadalupe Casanova, the yard superintendent.

Right after reporting to work on Dec. 22, 1995, Mendoza and his foreman, Appolonio Lucio, went below deck, into the bow of the USS Yukon, a tanker that had been used for refueling warships at sea. A compartment by the bow needed to be drained of water.

Neither man was wearing a safety harness, though harnesses were available. They decided to cut a hole in the compartment so the water could drain into one of the ship's 30-foot-tall tanks. It was cramped and dark. Mendoza adjusted his torch so the flame would burn yellow and cast more light.

He made some cuts, but the water drained slowly. He decided to walk across a beam to the other side of the tank, to make another cut.

Lucio said later that there was no need to rush; while the two men were waiting, they could have burned cables a reference to the illegal practice of burning the PCB insulation off copper cables.

But Mendoza wanted to get the job done. He walked across the beam, into the dark and out of sight.

"All I heard was a scream," said Lucio.

Mendoza's fall fractured his pelvis, severely cut his leg, and caused internal bleeding; he died two days later. The 43-year-old laborer left a wife and three children. His sister, Irma Zapata, is bitter about the accident and thinks her brother's employers were negligent.

"We came over here because we thought we'd be more protected in the States, and look what happens," she said. "There's no protection for the workers. Nobody's paying attention to the rules and regulations."

Casanova is the man primarily responsible for safety at International. While declining to talk about the accident, Casanova did say that he'd never sought or received kickbacks from anyone. One day, nearly a year after Mendoza's death, he talked about his commitment to safe work practices.

Wearing a hard hat with the logo "SAFETY FIRST" on it, Casanova said, "I am very tough. I demand too much especially in safety. Safety in any place must be the first thing."

Four days after that interview, Maximino Chavez was killed while walking across the International yard. Chavez, 58, was a laborer, an energetic man who was always looking for something to do. Among the men in Brownsville, everyone has a nickname; just as Casanova is universally known as the Avocado (because he used to be overweight and has dark skin), Chavez was called el Marranero, the Hog Man, because he raised pigs.

On Dec. 11, 1996, the day of the accident, a compartment of the USS Iwo Jima had been lifted off the deck of the helicopter carrier and was sitting in the yard. A cutter was slicing off a bulkhead. It fell just as Chavez was walking by, striking him across the back and throwing him to the ground.

"When you're working, you have to pay attention and let your partner know what you're doing," said Trinidad Becerra, who witnessed the accident. "The foreman has to have somebody watching all the time, because it is very dangerous."

It would be useless to simply shout a warning, like a lumberjack, he said. "There's so much noise around, you wouldn't hear it. That's why somebody has to be watching."

But Chavez wasn't paying attention; neither was anyone else.

Word came the next morning that Chavez had died in the hospital, leaving behind his wife and 13 children. Casanova gathered the men, told them the funeral would be the next day at St. Eugenio's. He said that they had to look after each other, Becerra recounted. "You take care of your partner and your partner takes care of you. In there you cannot fool around, because you will regret it later."

There was a moment of silence, and then they went back to work.

Failure to heed worker safety standards has been a problem at most of the 17 scrapyards doing Navy work since 1991. Pressure to work fast is constant owners only make money when they have cut steel to sell and everyone from laborers to crew chiefs to scrapyard owners takes shortcuts.

In Baltimore, torch handlers worked without other men on fire watch and without fire hoses. In Brownsville, workers burned PCB insulation off electrical cables instead of disposing it in a designated landfill. In Chesapeake, Va., Gerardo Vela fell while working on scaffolding without a safety harness; he died days later. At Quonset Point, R.I., a subcontractor didn't bother to dismantle a 180-foot mast but simply chopped it down like a big tree, sending it crashing.

The failure to take precautions has exacted an environmental toll as well. In San Francisco, a watchdog group accused a scrapyard of trying to save money by leaving toxic chemicals on the ground, where they could leach into the bay. In Wilmington, state officials shut down a yard on the Northeast Cape Fear River after discovering that it was contaminated by asbestos, oil and lead, and that oil had spilled into the river.

The yards waste little time on training. Lorenzo Lopez, an illegal immigrant hired in Wilmington, said: "They didn't explain anything. They told me to look at what the others are doing."

On Oct. 14, 1995, Lopez and another worker were told to cut steel pipes in the engine room of a destroyer, the USS Dewey. A flame from one of their torches ignited vapors that had accumulated overnight in a condenser.

The explosion was felt three miles away.

Lopez was knocked down. He was temporarily blinded, broke his leg, and burned so badly he spent six weeks in a hospital burn center. His eyesight was permanently damaged and he was disfigured.

"My eyes bother me," Lopez said. "I have problems with my legs. They hurt. I can read a little. ... If a friend asks me about taking the job I am going to answer, 'Don't take it. Just look at me.'"

A soft-spoken 28-year-old who doesn't speak English, Lopez came to this country from Guanajuato, Mexico, in search of opportunity, picking oranges, apples, and tobacco across the Southeast before finding work in the shipbreaking yard. Before the accident, he said, he would send $1,000 home so that he might someday be able to return to a better life. Now, unable to work, he has few prospects.

The Occupational Safety and Health Administration cited the yard for safety violations. The company failed to have an experienced employee check that no gases were present before any cutting began.

Lopez's was the second serious accident at the North Carolina yard in less than a year. On Feb. 24, 1995, worker Daniel Contreras was killed when a piece of metal flew out of a pipe-splitting machine and tore through his skull. OSHA determined that the accident could have been prevented if the machine, called an alligator shear, had the required safety guards. Like most efforts to enforce safety and environmental laws in the shipbreaking industry, the OSHA actions were taken only after the harm was done.

A common enemy

The ships now being torn apart at yards around the country were built with pride. Shipbuilding was a solid trade back then, and it paid well. The men who built the ships of the U.S. Navy men like Charles Fort of Dundalk and William Hooper of White Marsh had the satisfaction of doing a job right, of contributing to the nation's defense and of bringing home to their eastern Baltimore County communities a regular pay envelope.

Their lives could hardly be more different from those of men like Fermin Castillo, who today break apart Navy ships. Separated by time, culture and circumstances, they are linked by a common enemy: asbestos.

"Picture yourself going out in the morning and it's just starting to snow," recalled Hooper of his years building ships. "We're down below welding. This damn stuff was flying around like snow."

That was at Maryland Drydock. Across the harbor at Bethlehem Steel's shipbuilding division, Fort's experience was the same. "Everything was covered with a white dust, from the top of the engine room to the bottom," he said.

Even when Hooper, now 77, and Fort, 75, were young men, asbestos manufacturers and the Navy knew the material used for insulation and fireproofing could cause fatal lung diseases, but they kept that knowledge a secret, according to court records and congressional hearings. Because of concerns about disrupting the war effort during the 1940s, the Navy did little to protect the workers.

"If we tried to do all the things that might have protected these people, we would have gotten no ships built and that seemed to me a more important concern," Dr. Leonard J. Goldwater, a Navy industrial health officer during World War II, said in an asbestos lawsuit.

When inhaled, asbestos can cause diseases that develop decades later. Asbestosis results when scar tissue forms on the lungs, leading to breathing difficulties. Lung cancer is especially common among shipbuilders who also smoked. Mesothelioma is a cancer that attacks the lining surrounding the lungs, the heart and the abdominal organs, and is incurable and fatal.

Despite mounting evidence about its dangers, asbestos continued to be used extensively until the 1970s. The result was that thousands of men around the country died needlessly, many of them becoming ill decades after being exposed. Others, like Fort and Hooper, are sick today. Their misfortunes have been documented in courtrooms across the country, with more than 200,000 claims against asbestos manufacturers either resolved or pending.

Today there are stringent federal standards designed to protect workers from asbestos. The Navy, of course, is painfully aware of the need for such rules. But time and again it has has turned its vessels over to shipbreakers who show contempt for the regulations.

At Terminal Island, Calif., for example, Southwest Recycling Inc. sent employees to asbestos-handling classes, but then ordered them to ignore the procedures to save time, according to OSHA documents. "They (workers) were told to lie to the OSHA investigators if asked about work practices and not tell how it was really being done," a 1993 OSHA memo states.

In Wilmington, N.C., Sigma Recycling failed to train workers in proper asbestos removal methods, supply protective suits or provide medical screening, according to OSHA records. Workers shoveled asbestos debris into storage bins, which is prohibited by federal law, and did not wet down asbestos to limit dust.

In Baltimore, things were even worse. Over the past four years, the Coral Sea's dismal end has been marked by stubborn fires and dumping of oil into the harbor, by lawsuits and repeated delays but most of all, by the mishandling of asbestos.

Fermin Castillo, recruited from Brownsville to the Seawitch Salvage scrapyard in Baltimore, said he could see asbestos fibers in the air around him while he worked. Castillo watched as men nearby, dressed only in work clothes with no protective gear, stripped asbestos out of the aircraft carrier.

"There was asbestos all around us," he said. "At first they just stacked it on top of the ship. There was always a lot of dust in the air."

Enrique Mora, who worked as a supervisor at the yard in 1993 and 1994, said workers often tore insulation from pipes with their hands. He said he worked for four months before being provided with a respirator and that even then, fresh filters were often not available.

Workers said the only times they could be assured of having adequate protective gear was when inspectors or visitors were coming. "When investigators come, suddenly we get good equipment not gloves with holes," said Dionicio Huerta, a laborer.

Epifanio Rodriguez, 36, said part of his job was to knock a piece of pipe against a wall or bulkhead, so the asbestos would fly off.

Huerta described what happened next. To keep inspectors from finding the pieces of loose asbestos, Huerta said, he was told to stuff it through holes in the deck of a derelict barge. The barge was full of leaks and awash in harbor water.

"Sometimes whole pieces of insulation go into the water," he said. "You're handling all this insulation, and sometimes you inhale it, and then you cough up all this trash."

The mishandling of asbestos was so serious that it led to federal convictions for Seawitch Salvage and its owner, Kerry L. Ellis Sr., last May. Workers testified during the trial that Ellis had repeatedly assured them that they weren't being exposed to asbestos. They were worried, they said, but feared losing their jobs if they complained about the unsafe practices.

"People just do what they're told to do and keep their mouths shut," Huerta, 22, said in an interview.

John King was the same age as Dionicio Huerta when he was first exposed to asbestos while working on the Coral Sea a half-century ago at Newport News Shipbuilding and Dry Dock Co. in Virginia.

He worked as a pipe coverer, putting asbestos on boilers, pipes, air ducts and other hot surfaces for five years. King, now 75 and a widower living in Charlotte, N.C., suffers from asbestosis.

King believes the shipbuilders of his generation were sacrificed, and he's indignant that today's shipbreakers are no better protected.

"They should be warning them," King said. "Some subcontractor is hiring people just like I was hired, and dumping them down there to do this nasty work. All they want them to do is hurry and get through with the work. It's the same deal the same deal.

"I'm a common sense man but this just shouldn't have gone on," he said. "We need to get it stopped. It's not right to put people out there and you're killing them."

© 1997, The Baltimore Sun

By Will Englund and Gary Cohn

Sun Staff

BROWNSVILLE, Texas -- This dusty, dingy corner of South Texas is a near-perfect place to carry on a dirty job like ship scrapping.

Here along the Rio Grande, in a region that has the highest percentage of people living below the poverty line of any American metropolitan area, residents have had to contend in recent years with tick-borne fever, a high concentration of babies born with malformed brains and killer bees. It is one of the few places in the United States where leprosy has not been stamped out.

Brownsville, a city of 100,000, is home to garment factories, rail yards, oil-rig repair companies, used-clothing dealers. It lies just across the border from a cluster of "maquiladoras," assembly plants run by American corporations that are exempt from Mexican duties and have become notorious sources of pollution.

Here, said David Elizondo, a longshoreman who dreams of the day he might be able to organize the scrapyard workers, the politics are brazen, corruption is rife, and a few people have things comfortably in control -- abetted by low voter registration, low turnout among those voters who are registered and a certain Mexican fatalism.

"People here say, 'You're going to die anyway,'" Elizondo said.

A businessman gets left alone in Brownsville. It's a long way across wide-open, flat scrubland to the rest of Texas. State environmental regulators don't find their way down from Austin very often. The official in charge of PCB enforcement for the Environmental Protection Agency is based in Dallas, several hundred miles away, and went years without coming here. The two-man office of the Occupational Safety and Health Administration, responsible for all of South Texas, is a three-hour drive away, in Corpus Christi.

"There aren't a lot of people to bug you there," said Andrew A. Levy, a New York lawyer who has bought warships for demolition.

The port lies several miles outside town, along an artificial channel cut in from the Gulf of Mexico in 1934, a place where summer winds whip up huge sandstorms across the dry river delta. There, steel comes in as an old ship and it leaves as 2-foot-by-5-foot plates stacked in battered Mexican rail cars headed over the border, thanks to the exertions of immigrant laborers happy to have even low-wage jobs.

They come from little farms scattered across the Mexican countryside. They are willing and diligent workers, but unsophisticated, unaware of their rights and unable to speak English. Many in the scrapyards are working here legally. Many are not.

In the mornings, new arrivals stop in at the Oasis Cafe, on East Adams Street, next door to the Expreso Bus Station, where migrants from Monterrey and points farther south alight. The Oasis is the unofficial hiring hall for all the scrapyards in Brownsville.

Training here consists of watching the next guy. Precautions against asbestos or PCB exposure, or against fires or falls, are haphazard at best.

Pedro Rios, 65, a steel cutter for 23 years, said no one has ever talked to him about the health risks of the job. The men eat where they work, despite regulations requiring a separate lunchroom away from the fumes of burning lead paint.

The workers often lay a piece of painted steel plate on supports, put their tortillas on it, then heat it from beneath with their torches.

Another cutter, Orlando Saenz, shrugged off the hazards of ingesting lead. "All you have to do is eat a little chocolate," he said. "That'll keep you from getting lead poisoning."

The work force is uniformly Latino. Emilio Sanchez, from a prominent Mexican-American family, sees no puzzle in that. Sanchez owns the only cold-storage company in Brownsville equipped to handle the commercial shrimpers' catch, which gives him considerable clout in the port, and among his other business ventures he invests in merchant and Navy ships for scrap.

"The Hispanics are the best cutters, traditionally," he said. "It's the ethic. They're the best. We wouldn't use anyone else. I wouldn't do it any other way. It's not exploitation."

Rios scoffs at that. "The Hispanics can be abused. We have no choice," he said. "It's out of need we do this. I got this job because I don't know how to read or write. You could say this is a job for the dumb."

Elizondo, the union organizer, believes the shipbreaking industry flourishes here because of Washington's indifference to the Latino laborers of Brownsville.

"Why is the Navy dumping all these ships, this asbestos?" he asked. "Well, let's dump this on Brownsville. Let Jose take care of it."

© 1997, The Baltimore Sun

By Gary Cohn and Will Englund

Sun Staff

When the U.S. Navy began its great sell-off of surplus ships in 1991, Richard Jaross was among the first to see an opportunity.

He began dismantling Navy ships at a California scrapyard, where workers were exposed to lead and asbestos. He came to Baltimore to help put together the ill-fated Coral Sea project. He then set up a scrapyard in Wilmington, N.C., but the state shut it down for mishandling asbestos, polluting a river and contaminating the soil with oil and lead.

Troubled histories, it turns out, are not uncommon among the shipbreakers to whom the Navy has entrusted its ships. Among the others are:

• Andrew Levy: His company managed a maritime union retirement plan in the 1980s and lost more than $20 million, according to the U.S. Department of Labor. A federal court permanently barred him from managing private-sector benefit plans. He later became involved in the Coral Sea project and in a scrapping operation that was closed down in Rhode Island.
• Kreso Bezmalinovic: Before he got into shipbreaking, he pleaded guilty to paying off a government inspector. Later, he was convicted on federal fraud charges involving asbestos-abatement companies he controlled.
• Emilio Sanchez: A South Texas businessman with many interests, in 1994 he tried to negotiate in Mexico two stolen U.S. Treasury checks -- each made out to him for $10 million. Never prosecuted, he has bought the scrapping rights to several Navy ships since then.
• Kerry L. Ellis: The owner of a Baltimore company scrapping the Coral Sea, he tried to fool any inspectors who came around. Prosecutors finally caught up with him, leading to his conviction in May for mishandling asbestos and dumping oil and debris into the Patapsco River.

The shipbreaking industry, which involves about a dozen key operators, has left a dismal record of spills, accidents, deaths, lawsuits, bankruptcies and indictments at ports across the country.

"The history of ship scrapping in the United States in the past five years has been terrible in all ways," said E. Grey Lewis, a former Navy general counsel. "The people involved in it are one-night stands. They've been indicted or they've had to flee the area. And, of course, the United States Navy is now on notice that these people are not obeying the law."

The negligence at the scrapyards has been abetted by the Navy's and Defense Department's lack of vigilance. There is virtually no meaningful monitoring of the shipbreaking industry. Prosecutors and regulators from a disjointed network of agencies sometimes have stumbled upon violations at individual scrapyards, but the Defense Department agency that administers the scrapping program has done little to address its failings.

That agency, the Defense Reutilization and Marketing Service (DRMS), said it has raised standards for selecting scrappers. But critics say that is hardly enough.

"They sell a ship ... then all hell breaks loose," said F. Browne Gregg, whose company participated in a scrapping venture. "They literally lose control of the ship."

'Clearly not in command'

On Sept. 16, 1993, DRMS sent its lone inspector, Tommy Evans, on his first visit to the Seawitch Salvage yard in Baltimore since the arrival of the aircraft carrier USS Coral Sea. But Evans didn't inspect the vessel that day.

He thought it too dangerous.

"I could not get aboard the Coral Sea due to safety reasons," Evans wrote in his report.

The next day, a 23-year-old worker named Alfio Leonardi Jr. found out how unsafe the vessel could be. He and Kerry L. Ellis, the scrapyard operator, were walking on the flight deck when Leonardi stepped on a tabletop-size piece of deck plate that had been cut but hadn't fallen. The area wasn't roped off or marked. The plate dropped through and Leonardi fell with it, 30 feet to the hangar deck.

"I felt a burning feeling inside," he recalled. "There was blood coming out of my mouth. I didn't think I was going to live."

Leonardi suffered a ruptured spleen, a fractured pelvis and fractured vertebrae in the fall. He broke his arm so severely that two rods had to be inserted. He has been unable to return to the vigorous work he once loved.

"It's like my whole life stopped the day of that accident," said Leonardi. "I can't do nothing anymore."

Evans, the DRMS inspector, was new to the job when the accident occurred. He had a total of 20 hours' training in environmental issues. He declined to be interviewed, but others described him as intent on doing the right thing and completely unfamiliar with the world of shipbreaking.

"Tommy Evans was not appropriately trained and he didn't have any experience in shipbreaking," W. Warren Hamel, a federal prosecutor in Baltimore, told a jury last spring during Ellis' trial. "He was clearly not in command of the situation."

For Ellis, it was like having a free pass to violate the law.

When Evans called ahead to say he was coming, Ellis and his managers "would put up yellow caution tape and he was told no work was going on," recalled Neil Mandelman, a former supervisor at the yard. "After he left, we would go back to those areas."

The problem was not simply with Evans. His agency, DRMS, was set up to sell everything from boots to woolen hats to footlockers. Its goal is simple: Sell off inventory as fast as possible for the best price possible.

But a warship is different. The Navy retains title to the ships while they are scrapped, so it is not freed of responsibility for them. And it can take months or even years to break a ship apart. As the Navy's sales agent, DRMS is supposed to oversee the work but has little experience in monitoring something so complicated.

"I could put dead bodies on the ships, and they wouldn't know about it," said an environmental consultant, Said Farrokh, who has worked on ship-scrapping projects.

It was clear from the start that the Coral Sea project would be daunting. When Kerry Ellis took on the job, it was to be the largest shipbreaking project in Navy history. Ellis had scrapped bridges and drydocks before, but nothing remotely as big as the carrier. Andrew Levy, whose company hired Ellis to scrap the ship, said Ellis spent three months just trying to figure out where to begin.

When the cutting started, so did the chaos. There was no systematic plan to dismantle the ship. Workers often weren't protected with respirators or safety goggles, hard hats or hard-toed shoes. Ellis was frequently strapped for cash. His partners accused him of stealing scrap metal and even hired a helicopter to spy on the operation.

And the workers weren't being paid, so they went back to Texas. "He said he was short and would be sending it along," said Pablo Sauceda, 60. "He never did."

Ellis simply replaced the men with others, similarly desperate enough for work that they would tolerate the unsafe conditions: the asbestos in the air, the risk of accidents, the repeated fires.

On Nov. 3, 1996, a fire broke out in the Coral Sea's engine room. With no one standing fire watch and with no hose nearby, the blaze quickly burned out of control. For the sixth time, the Baltimore Fire Department was called to the scrapyard.

Ellis was furious. He was even angrier a couple of days later, when another fire broke out.

"Kerry was screaming, 'Get down there! Get down there!' " said Epifanio Rodriguez, who went down into the ship with another worker and put the fire out because he didn't want to appear cowardly.

"It's just too dangerous. You could fall," he said. "If I didn't go down there, they'd curse me and fire me."

By then, Ellis was under indictment for asbestos and environmental violations. Typically, DRMS, the agency assigned to oversee scrapping operations, was largely unaware of the most serious problems on the Coral Sea and played no role in curbing them.

Ellis, convicted in U.S. District Court in Baltimore in May of dumping oil into the harbor and exposing workers to asbestos, is awaiting sentencing. He declined to be interviewed.

His son, Kerry R. Ellis, has taken over the Coral Sea project, which was intended to take 15 months but is now in its fifth year. While scrapping a warship is always complicated, the younger Ellis said, the difficulties with the Coral Sea were compounded by the Navy's failure to provide reliable information about the location of hazardous materials.

Ellis believes his father was prosecuted to cover up government mismanagement of the ship-scrapping program.

"The Navy or DRMS knew they and their personnel were a big part of the problem," he said. "To protect themselves, they basically needed a fall guy."

Better at the dreams

Ships have been scrapped for generations, but it took someone like Richard Jaross to envision shipbreaking as a modern U.S. industry, recycling on a grand scale.

Jaross, though, proved better at the dreams than the details.

"He's a guy you want to believe in," said Roy Dale, a lawyer who has worked with Jaross in South Texas for decades. "I think he's sincere and he goes into an idea with the idea he's going to make money. It's only when the thing goes south that he starts to look out for his own butt."

Those who have dealt with Jaross are familiar with the pattern. "He moves in, bends the rules to the extent possible, then just about the time the federal and state regulators realize there is a problem, he's finished scrapping the ship or he just takes off," said David Heeter, a North Carolina assistant attorney general.

Jaross showed up in Brownsville, Texas, 25 years ago, a young businessman from Dallas who believed that a fortune could be made in shipbreaking. He had the gift of good timing. Right after World War II, shipyards around the country, including Bethlehem Steel in Baltimore, had scrapped a huge number of surplus ships. In the 1970s, Jaross realized that another wave of ships -- a generation of merchant vessels -- was reaching retirement age.

And there was hardly any competition. Rising labor costs, followed by ever-stricter safety and environmental laws in the United States, had pushed shipbreaking overseas.

He recruited some bright young men, former members of the Boy Scout troop he led in Dallas. The money came easily in those early years; Jaross was able to buy a television station and invest in South Texas land deals. He even founded a Montessori school.

His success was helped immeasurably by his partnership with Emilio Sanchez, owner of Tex-Mex Cold Storage, which handles virtually all the shrimp coming into Brownsville. Sanchez was well connected. An ally was chairman of the port commissioners, and Sanchez's late brother was a Texas state representative who married into oil money.

Where Jaross is energetic and impulsive, Sanchez is serene and courtly. But acquaintances describe him as a tough businessman. His plain office is adorned with one painting, which shows a pride of ferocious lions about to bring down a gigantic bull. Over the years, Sanchez and Jaross have bought and sold more than 600 government and private ships for scrapping in the United States and overseas.

By the mid-1980s, though, the supply of old merchant ships was drying up. In 1985, a Jaross firm called Andy Machinery Co. pleaded guilty to defrauding the government. The company had been scrapping a Maritime Administration ship when investigators caught Jaross selling lead ballast that belonged to the government and pocketing the proceeds.

"They took a contract dispute and made something criminal out of it," Jaross complained recently. "We thought it better to just settle."

The company was ordered to pay restitution of $42,861 and a $10,000 fine. Soon after, Jaross filed for bankruptcy.

With the end of the Cold War, though, he realized before anyone else that a new opportunity beckoned.

In 1991, he helped start a venture to scrap Navy ships on Terminal Island, in Los Angeles harbor. The company, Southwest Recycling, acquired the USS Bonhomme Richard, an aircraft carrier, and three other vessels.

But after receiving complaints, federal Occupational Safety and Health Administration and state investigators turned up serious safety and environmental violations at the scrapyard.

Leaving his angry partner to deal with crushing financial problems and the unfinished scrapping job, Jaross moved on to Baltimore to help with the Coral Sea project. That, too, ended badly. Jaross was forced out by Kerry L. Ellis after complaining about how the scrapping was done and attempted to set up a rival yard. The Army Corps of Engineers caught him illegally filling in part of the harbor. In the end, the city refused to give Jaross required permits.

In 1994, Jaross went to Wilmington, N.C., to scrap more Navy ships. He had promised to set up a model yard, but what he delivered was far different.

One worker was killed, another seriously injured. A minesweeper sank. Asbestos, oil and lead contaminated the site. Oil spilled into the river.

It was next to impossible to keep track of the people and companies involved in the scrapping operation. Over two years, at least 16 companies and partnerships had a financial stake in the ships or the yard.

In July 1996, the state finally shut the operation, forcing the Navy to reclaim 12 ships. If it hadn't been for anonymous tipsters, state officials said, they never would have known of the problems at the yard. DRMS, the Defense agency, had turned up some of the violations, but it didn't alert the proper enforcement agencies.

Heeter, the assistant North Carolina attorney general, faulted DRMS for its lax efforts. "They are in the business of unloading this stuff and making as much money as they can," he said. "They're certainly not regulators from the standpoint of protecting the environment."

Jaross, 57, says he's out of the business. He's been selling used clothing to Africa. But he said he would love to try scrapping nuclear submarines ("I'd be like a kid with a toy"), or set up a "modern-type" yard for general ship scrapping in Baltimore. "That would be the place," he said.

Jaross acknowledged that there have been problems at his operations over the years but says he's been responsible in tackling a tough job.

"It's a very complicated business. I don't think you can do all these ships and not have problems," he said. "It's not like we're running around like wild men trying to break the law."

His former partner, Emilio Sanchez, has had his own problems in the past few years. He was caught up three years ago in a scheme by a scrap-metal dealer who happened to possess a half-dozen blank U.S. Treasury checks stolen from the St. Louis post office.

The dealer, Genaro Alvarez, and Sanchez drove to Matamoros, Mexico, and tried to negotiate two of the checks -- made out to Sanchez for $10 million apiece. Two banks there refused to handle them. U.S. authorities were alerted, and Sanchez and Alvarez were arrested soon after in Texas.

Prosecutors in St. Louis won convictions against Alvarez and others involved, but charges against Sanchez were dropped. In an interview, he maintained that he was an innocent victim of the scheme. He said he thought Alvarez was giving him legitimate checks to be invested in a steel mill in Monterrey, Mexico.

Since then, Sanchez has acquired three Navy ships for scrapping. He contracted with a Brownsville yard, International Shipbreaking, to dismantle them; two men were killed on the project.

Selling shipbreaking

Andrew Levy is a persuasive salesman, and from his Park Avenue office in New York over the past six years he's sold investors on shipbreaking. But the deals haven't always worked out.

"All I know is what I hear from Andy, and when you talk to Andy, everything is always great," said Harold Schein, the principal investor in a failed Rhode Island deal to scrap two ships. "It looked like a lucrative contract. But it turned out to be a headache for everybody. I never got any money out of it."

Levy, a graduate of Yale University and the Harvard School of Law, started out practicing law, then began dealing in oil leases and managed pension plans.

Among his customers in the mid-1980s was the International Organization of Masters, Mates and Pilots, based in Linthicum Heights, Md. Levy and his partners controlled $31 million in retirement funds and had a mandate, he said, to invest in companies creating maritime jobs.

But they put some of the money into businesses in which they had a direct interest and took fees of more than $1 million from those companies, according to a federal court ruling.

The Labor Department deemed that a clear conflict of interest. The department and union members also provided evidence in court that Levy and his partners had lost more than $20 million in union investments.

Levy disputes that, arguing that the investments eventually made money. But he and his two partners were permanently barred by court order from managing the assets of virtually all private-sector benefit plans. An appeal was turned down in 1992 by a panel of judges who wrote that Levy and his partners had engaged in "egregious self-dealing."

In the 1990s, Levy has been a key figure in buying Navy ships. He's lined up investors to put up the money and then found scrappers to dismantle the vessels.

In a 1995 brochure for prospective investors, for example, Levy's projections were enticing. He estimated that investors would get a 46.5 percent return in a venture to scrap 12 ships. While the project never went forward, the brochure illustrates Levy's optimism.

He planned to scrap the ships in 21 months. He figured on spending just $550,000 to clean up asbestos, PCBs and other toxic materials. He anticipated a profit of more than $4 million. But scrapping operations almost never run as smoothly as the brochure suggested, making those figures unrealistic.

That's because of a fundamental economic fact about shipbreaking: The proceeds from selling scrap are almost never enough to cover expenses, particularly the cost of removing hazardous materials properly.

In the Terminal Island shipbreaking project, for example, the scrapping company lost about $5 million.

"Considering all the risks and dangers and environmental hazards," said Dan Cotter, who administered the project, "it's not even close to being a good business to be in."

In 1993, a San Francisco group called Arc Ecology concluded after a study that ship scrapping could not be profitable. "If the work was done properly, it really wasn't economically feasible," said Eve Bach, who helped prepare the study.

Levy's Rhode Island project demonstrated the financial pressures.

In 1995, he obtained two guided-missile cruisers, the USS Biddle and USS Yarnell, and sent them to American Shipyard.

The yard had turned out ships for the Union fleet during the Civil War and for more than a century repaired America's Cup yachts. But the Newport business was on the brink of bankruptcy.

Its owner was a Croatian immigrant named Kreso Bezmalinovic, who had run an asbestos-abatement firm in New York until it was caught in a bribery scandal involving payoffs to an Environmental Protection Agency inspector. Bezmalinovic eventually pleaded guilty to paying an illegal gratuity to the inspector.

In 1995, Bezmalinovic, who had no experience in ship scrapping, leased a state-owned pier at the old Seabee base near Quonset Point and hired a crew from Texas.

In the next year:

• Bezmalinovic was indicted by a federal grand jury in New York for conspiracy, fraud and obstruction of justice. Prosecutors argued that after his asbestos-abatement firm was barred from government contracts, he secretly used another company to obtain them. He was convicted in June.
• A state agency discovered unsafe practices at the Rhode Island scrapyard, including a lack of fire watches, monitoring for lead or asbestos exposure and an approved plan for PCB removal.
• The expected profits did not materialize and American Shipyard was pushed into bankruptcy.
• Levy attempted to hire a crew himself to scrap the ships, but the state obtained a court order and forced him out. "Why stay," he said in an interview, "where you're not wanted?"

Bezmalinovic said the project failed because of unexpectedly high costs. "In a desperate situation, you do what you can," he said, "but believe me, as desperate as it was, we didn't cut any corners."

For his part, Levy is disillusioned about the shipbreaking industry. "This is not all that great a business for the United States," he said. "It is a bit of dirty business and it has been proven that the localities don't want it."

And, he said: "Quite frankly, I can make a lot more money doing other things."

'Fundamental error'

With the current scrapping system in disarray, what should the Navy do?

Daniel Peck, a scrapper in Richmond, argued that the Navy should regard the dismantling of a ship as a cost it must bear and pay a private contractor a fair price to do the job properly.

E. Grey Lewis, the former Navy general counsel, agreed. "You have to give these ships away or pay for companies to scrap them," he said.

Alternatively, the Navy could pay a qualified contractor to remove asbestos and other hazardous materials from its ships, and then sell the vessels to scrapyards.

"The idea that we're solving significant hazardous waste problems on the cheap -- that's the fundamental error," said James Moorman, an environmental lawyer in Washington. "The Navy is just not owning up to the cost of disposal."

But the Defense Department has declined to pursue such options. Instead, it says, it has beefed up monitoring and is being tougher about who is scrapping Navy ships.

"The Navy is very concerned with the necessity of ensuring that ship scrapping is conducted in an environmentally sound manner and in a way that protects the health and safety of workers," the Navy said in a prepared statement. Navy and DRMS officials responsible for the ship-scrapping program repeatedly refused to be interviewed, though they have answered questions in writing.

DRMS said that it now has four inspectors monitoring ship-scrapping contracts instead of one. And since September 1996, bidders have been required to submit a proposal showing how they plan to dismantle a ship, how they will dispose of hazardous substances, how they will comply with health and safety requirements, and that they have the financial ability to complete a scrapping project.

Have those changes fixed the problems?

"Absolutely not," said Peck. "Nobody from the government who is checking out the qualifications of the bidders has any experience in scrapping ships. They have no idea whether a potential scrapper can do what they represent they will do. They have very little understanding of what it takes to cut up a ship."

© 1997, The Baltimore Sun

By Will Englund and Gary Cohn

Sun Staff

ALANG, India -- This is where the world dumps its ships, worn out and ready to be torn apart.

To the left and right, ships lie stranded along six miles of beach, in a hundred stages of demolition. Tankers, freighters, fish processors and destroyers -- smashed, cut, rusting, smoking -- are packed close together. This is the end of the line.

Thirty-five thousand men have come to this once-deserted stretch on the Arabian Sea to labor for the shipbreakers. They live in hovels built of scrap, with no showers, toilets or latrines. They have come from poor villages on the other side of India, lured by wages that start at $1.50 a day, to work at dangerous jobs, protected only by their scarves and sandals.

They suffer broken ankles, severed fingers, smashed skulls, malarial fevers, chol-era, dysentery and tuberculosis. Some are burned and some are drowned. Nobody keeps track of how many die here from accidents and disease. Some say a worker dies every day.

"There is a shadow of death on this place," says Ram Lalit, a 22-year-old worker. "This place is haunted by death. But it is better to work and die than starve and die."

The U.S. Navy, which for years has insisted on scrapping its ships in the United States, now wants to send them abroad -- here to India, or to similar beachfronts in Pakistan or Bangladesh.

With its American scrapping program entangled in environmental and worker safety problems, criminal charges, bankruptcies and lawsuits, the Navy has decided to drop its old policy. To escape the turmoil in its domestic program, it could simply export its obsolete ships, laden with asbestos, PCBs, lead, toxic sludge and other hazards to South Asia.

The plan required the Navy to obtain an exemption from rules prohibiting the export of certain hazardous materials. The federal Maritime Administration, which owns a fleet of old cargo ships, tankers and other vessels, received a similar exemption.

With about 170 ships designated for scrapping, the Navy and Maritime Administration point to the higher prices the vessels can fetch abroad. But selling the ships overseas could put the U.S. government in the center of a growing debate over exploitation of Third World workers -- those who make the sneakers, clothes and toys to satisfy Western tastes, and receive the used car batteries, plastic bags and toxic chemicals that the West discards.

If they are sent to Alang, the U.S. government ships will join American merchant vessels that already come here. They will add to the long ranks of broken hulks -- from Norway, Japan, Greece, Russia -- that meet their end on the 190 plots here, where smoke and dust obscure the sun, and the crash of steel and the guttural rasp of the torches drown out any other sound.

The beached ships tower over the hundreds of workers who strip them apart, men who know they are expendable.

"All burden to the laborers and none to the owners," says Shive Cheren Bharti, 36, who has worked at Alang for 14 years. "There's no risk to them. If 20 people were to die at once, the owners wouldn't care."

Then, his face inexplicably lighting up in a big grin, he says, "We're the hopeless people of India."

High tides, low beach

Alang exists because of the tide. It is one of those places -- like the Bay of Fundy in Canada -- where a host of geographical circumstances come together to create exceptionally large differences between the twice-daily high and low tides. Coupled with a soft, shelving beach, the tides at Alang make shipbreaking possible with a minimum of construction. There are no piers or drydocks. Ships are simply run onto the shore.

Giant merchant vessels powered by thunderous engines and navigated by satellite signals carry the goods and fuel that enable the modern technological world to exist.

Yet a ship ends its life at the hands of several hundred practically barefoot men, and the beginning of that process depends on the phase of the moon.

Twice a month, at the full moon and new moon, high tides are at their highest, and this is when a ship, be it 3,000 tons or 50,000 tons, can be driven the farthest onto the beach. And, just as a ship is launched with a bottle of champagne smashed across its bow, the dismantling begins with workers on the beach hacking open a coconut and offering a prayer for protection to the elephant god, Lord Ganesh.

But prayers aren't always enough.

On Jan. 8, the men at Plot 37 were cutting up a Greek freighter called the Vakis-T. Eight workers were cutting in a section at deck level.

"I was two feet away," says Shiv Shankar, 38. "I was talking to them. The last thing I said was, 'Why don't you work faster? It's time to get this job over with.'" The whole section broke off and plunged 40 feet into the ship's hold. Three men died from head injuries. Five survived. None was wearing a hard hat. "This was God's will," says a supervisor, Toofani Bhai, 32. "Nothing could be done about it. I felt hurt -- it pained me. I was among those who picked up the bodies and put them on the ambulance."

"It was their call to death," says Shankar, with a shrug. But not everyone here is so accepting of fate.

"The joint that broke was almost rusted through," says a worker, Sita Ram. "The shipbreaker should have known it was weak. But the shipbreakers have no regard for life.

"Alang," he says, "is a colony of the dead -- breathing, walking dead men." After the section fell, the owner of the yard called for Alang's single ambulance. It happened to be available. Digvijay H. Sarviya, the driver, says that when he got to the accident scene it appeared that two men were dead and one was near death. He decided to load all three into the ambulance, because he wasn't sure.

"Giving first aid would consume too much time," he says. "I just rush them to the hospital."

Sarviya says he makes the 40-mile trip to the hospital in Bhavnagar once a day, sometimes twice. The drive, on a two-lane road clogged by trucks, scooters, tractors and cows, takes 90 minutes to two hours. When Sarviya reached the hospital, all three of his passengers were dead.

The Vakis-T accident was hardly the most serious at Alang.

"I've seen many worse accidents," says Bhai, the supervisor. "I've seen 15 men killed."

This year, a fire reportedly killed 18 men, and at least eight died in separate blazes. In the summer of 1995, up to 12 workers -- accounts vary -- were asphyxiated by ammonia on a Russian fish-processing ship. In 1988, a fire aboard a cargo vessel killed as many as 40 men.

Recently, the Red Cross opened a clinic at Alang, but doctors and nurses don't like to come here, so it is rarely open. Most injured workers are taken to the government hospital in Bhavnagar, but a handful of owners send injured workers to Dr. Dinkar Dholakia's orthopedic clinic there instead.

They are housed together in a basement room, where daylight hardly penetrates the small dirty windows. But everyone considers this better than the hospital.

Dr. Mukesh Shah says about 10 new patients arrive each month at the clinic. Many have anemia because of poor nutrition, and skin problems such as scabies because of poor hygiene and no laundering. Poor sanitation contributes to gastroenteritis. Many suffer from tuberculosis and alcoholism. About 40 percent of the patients have malaria, he says.

One patient, Vijay Shahu, 34, of Orissa, had been injured at Plot 88 when a steel plate crushed his right leg. He was in shock when he arrived and the doctors couldn't find a pulse. He will not be able to work at the yards anymore.

Ramesh Prajapati, 22, of Uttar Pradesh, was admitted without a detectable pulse when a pipe fell from a crane and hit him in the head. His future? "Let us all hope for the best," Dholakia says.

Life in Alang

Workers in Alang begin stirring around 7:30 a.m.. Some wash from a bucket on the muddy ground outside their huts. Others squat by puddles, dipping toothbrushes in the yellow water and cleaning their teeth. There's early morning coughing all around.

At this hour, the chief activity is along the strip of shacks that serve the workers' needs: a barber's stall and a tailor's, a man who does laundry and a Muslim prayer leader, vendors who sell bicycle parts, kerosene lamps, sodas, cigarettes, fruit and eggs.

A small Hindu temple stands outside the gate to Plot 18. The temple is shaded by a neem tree, with two bells salvaged from ships hanging from a branch. It is one small reminder of a world, a life, that exists beyond the yards.

The men live in shacks they have built out of lumber harvested from the ships. The shacks are packed on the dunes behind the beach, separated by muddy alleys. Four or eight or 12 men might live in one shack. There is no furniture, no light, no water.

Sriram Prasad, 32, with dark hair brushed forward and a bushy mustache, counts himself among the lucky men of Alang. He lives in an 8-foot-square shack with three others. They sleep on a table. The walls are covered with newspapers; little triangles of colored paper hang from the ceiling. He has a wife and two sons back home. A brother and many of his neighbors work here. He gets the shack for free.

He says he has worked here 10 years. "It's hazardous -- we're always scared of getting hurt. I get bruised all the time, but I've been lucky and never seriously hurt.

"But I've seen so many people die. I've seen 100 people die before my eyes. It is just a matter of destiny."

This attitude infects seemingly everyone in Alang. Destiny brings men who otherwise could not support themselves to this fiery corner of India. Destiny wears them out and fills them with malaria. Destiny deprives them of decent sanitation. Destiny burns them and crushes them.

"The best thing is the money, which I wouldn't get anyplace else," says Prasad, "and the worst thing is not knowing how long you'll be alive."

A single, heaving rutted road runs parallel to the beach. In the morning light, cows amble along looking for scraps of food. The trucks come to life; soon they'll be jostling for room and, later, the owners' Japanese four-wheel-drives will come blaring and darting among them.

The workday begins, no different from the day before or the day after. A cutter takes a torch to an engine room pipe, and residual oil inside bursts into flame. Nearby, smoke rolls from a smothered fire, mixing with the acrid fumes of burning steel and paint. A little farther off, a ship's deckhouse is pushed off its perch and plunges 70 feet to the hold below, with a crash that sends a huge dust cloud swirling.

Pairs of workers carry oxygen canisters on their shoulders, cushioning the load with their all-purpose safas, traditional Indian scarves. Gangs of a dozen or more men, plastic sandals on their feet, chant in unison and hoist heavy plates of steel onto their shoulders. Others heft cutting supplies alongside the beached ships, wading through muddy sand saturated with oil, dust, sludge and human excrement.

The scrapyard owners look on from their porches, sipping sweet milky tea. Walking to or from the yards, the men of Alang seem listless, worn out, beaten down. But they are diligent workers. At Plot 66, two men, facing each other, pull on the ends of a large hacksaw, like lumberjacks, cutting the copper pipes of a boiler. They've been at it since 3 p.m. the day before. They expect to finish toward sundown the next day.

Back and forth, in a patient trance, with an unvarying stroke, they pull at the saw.

"It's how we earn our bread," says Ram Sanwarey, 38.

Sought-after ships

The most sought-after ships are those that fly the American flag. Greek tankers and Russian trawlers are the bread and butter of the scrapyards here, but a shipbreaker knows that a U.S. merchant vessel was built with high-grade steel, was well-maintained, and will be clean of grease and sludge when it arrives. It will be laden with asbestos and PCBs, but Indian shipbreakers do not worry about environmental damage or exposing their workers to hazardous substances. And, anyway, almost all the world's ships (except the newest) were built with asbestos and PCBs.

An American tanker called the Keystone Rhode Island arrived at Alang this year after three decades hauling oil. Owned by a shipping firm in Bala Cynwyd, Pa., the Rhode Island was sold through a New York broker to a middleman in Singapore, who sold it to a breaker here. It was one of several hundred ships that make their way to Alang every year through brokers in London and New York. In 1996, the brokers sold 464 ships for scrap, with 289 coming to India and most of the rest to Pakistan or Bangladesh. There are no reliable figures on the number of warships and commercial vessels -- mostly Russian -- sold outside the established brokerage system.

The Rhode Island was built in Baltimore by Bethlehem Steel for the Texaco Oil Co. Launched in July 1964, the 604-foot tanker represented American shipbuilding in its prime. Texaco brought in dignitaries by train for the ceremony; Beth Steel threw a lunch afterward at the Sparrows Point Country Club.

The tanker had 90,000 feet of pipe and was covered with 8,500 gallons of lead-based paint. It was powered by big steam turbines, which the Indian shipbreakers treasure because of the high-priced specialty metals that went into their construction.

Legacy of the Exxon Valdez

Its demolition is part of a much larger story.

After the Exxon Valdez ran aground in Prince William Sound in Alaska in March 1989, spilling 11 million gallons of oil, the disaster led to stronger measures to protect the environment. Congress required new tankers to have double hulls -- one inside the other -- and outlawed the use of single-hulled tankers like the Exxon Valdez by 2010.

The result has been a bonanza for Indian shipbreakers, as the world's major tanker lines replace their fleets. There are about 6,700 tankers in the world. Each tanker scrapped in India (or in Pakistan or Bangladesh) means the wholesale release of oil, sludge, asbestos, PCBs and chromates onto the beach and into the water, and the release of lead fumes into the air from burning paint. Each tanker scrapped translates into a dozen or more injuries among the workers, and an even chance that someone will be killed.

That is the last legacy of the Exxon Valdez.

With the Keystone Rhode Island, as with all ships here, the breakers begin cutting from the bow and work their way aft, leaving the bottom plates to the end. A tanker can be dismantled in about seven weeks; a warship takes considerably longer, because it is full of compartments and hard-to-cut armor plate.

Any equipment that can be reused is sold through secondhand dealers on the road from Bhavnagar. Buyers can find, in varying states of repair: sinks, toilets, chairs, mattresses, life jackets, china, telephones (with and without dials), lumber, doors, desks, fire hoses, colanders, mixers, pumps, water fountains, vacuum cleaners, refrigerators, washing machines, diesel engines and surgical tables.

One dealer had an American flag, in a heap on the ground, and a selection of pianos (including a Soviet Red October upright, badly out of tune).

But items such as these account for only about 4 percent of a shipbreaker's income, said Bhavin Shah, overseer on the Keystone Rhode Island. The money is in the metal. And the secret to making it, he said, is to break the ship and sell the steel as quickly as possible.

The U.S. Navy, which could soon send dozens of ships here, has had a handful of vessels scrapped in Alang in recent years. The USS Bennington, for example, came here in 1995.

A company called Resource Recovery International paid $200,000 to scrap the World War II-era ship in the United States. Then the company agreed to pay an additional $1 million in return for being allowed to send the aircraft carrier to India. In December 1994, Resource Recovery sold the vessel to a middleman in England; the middleman then sold it to an Indian shipbreaker for a reported $6 million.

The escalating resale price is explained by the lower costs South Asian shipbreakers incur -- and the higher profits they collect -- because they pay paltry wages and aren't hindered by tough safety and environmental regulations. The Defense Department did require Resource Recovery to submit a technical plan outlining how workers' safety and health would be protected. But the plan was meaningless. Rohit Bhatt, an official with the Alang scrapyard, said his company had no contact with anyone from the U.S. government or Resource Recovery.

On a visit to the site, Sun reporters saw about 400 workers cutting steel with torches and doing other work as they dismantled the Bennington. No special precautions were taken in removing asbestos or other hazardous materials.

In fact, nowhere in Alang, among the tens of thousands of men, did anyone wear a hard hat, safety harness or respirator, even though they are required by the Gujarat Factories Rules.

Under its new policy, the Navy wouldn't need to inquire about safety practices in India. Such formalities as existed in the Bennington project, at least on paper, would be swept away.

Overseas sales of U.S. warships became possible this summer after the Environmental Protection Agency gave the Navy an exemption from rules banning the export of ships containing PCBs, or polychlorinated biphenyls. They were widely used in electric insulators until the 1970s, when they were linked to serious health problems.

The export agreement requires the Navy to remove the most hazardous PCBs, those in liquid form. Most others, though used in thousands of ship parts, can remain.

Asbestos and other toxic substances are not addressed in the agreement, and the Navy is not required to remove them before exporting ships. The Maritime Administration, which owns a large fleet of obsolete merchant vessels, signed a similar agreement last month.

Joan M. Bondareff, chief counsel for the maritime agency, says it is required to get the highest price possible for its ships; selling them overseas brings far more than selling them at home.

She describes the agreement as a "win-win" for the agency and the environment. "We can continue to export obsolete ships for scrapping and the environment is protected with the removal in the United States of PCBs," she says. Navy officials declined to be interviewed about overseas scrapping. But in a written statement, the Navy says the agreement "provides an opportunity for the Department of Defense to maximize the return to the U.S. Treasury from such sales."

Sen. John Glenn, an Ohio Democrat, is critical of the export plans. "While I understand the need for the Navy ... to be able to dispose of surplus craft in an expeditious and cost-effective manner, U.S. jobs and environmental problems should not be exported in the process," Glenn wrote recently to Navy Secretary John H. Dalton.

James Moorman, an environmental lawyer and former assistant U.S. attorney general, agrees.

"The Navy can manage things if they want to -- it appears they're just not interested," says Moorman. "This idea that we ship pollution problems to a Third World country strikes me as a serious mistake. It's the sort of thing our government shouldn't be doing."

Where labor is cheap

It's not surprising that the shipbreaking industry developed in India. Labor is cheap. There's a domestic market for steel. The owners are driven. The workers and their few advocates are powerless. In a Third World nation beset by corruption, poverty and overpopulation, government regulation is ineffectual.

Alang is so remote that few people other than workers or owners ever make their way here. Local officials say the industry, which started in 1983, is only now maturing. While there have been plans for several years to create a development authority to build housing, schools and a hospital, nothing has come of them. The workers, left to fend for themselves, have nowhere to turn when disabled by illness or accident. Everywhere in Alang are men who are too hurt to work but are hanging on, hoping for a settlement from their bosses.

Sanjay Tatoba, 26, of Mahareshtra, was asked one morning why he was not working. He raised his left hand. Two fingers were missing. "I feel it should not have happened, but who should I direct my anger against?" he says.

Under Indian law, men who are injured and the families of those killed are entitled to compensation from the owner. In practice, they have to prepare themselves for a long wait. Just ask Pradeep K. Thakkar, a robust lawyer who is one of the very few and very lonely advocates for the workers at Alang. Thakkar represents more than 300 Alang workers or their families before the Labor Court in Bhavnagar. It has just one judge and a backlog of 10,000 cases. Prospective clients can find Thakkar at his office on lawyers' row in Bhavnagar. They must first climb stairs so steep that a knotted rope is provided to hang onto.

Thakkar is a forceful and unstoppable speaker. He chews betel nuts constantly, which stain his mouth red. He sits by a row of open windows, in a tiny, narrow office, spitting regularly out the window and working despite the constant din of horns, scooters, bicycle bells, cooing pigeons and slamming shutters from the street below. He keeps each case in a worn, folded manila cover, tied with faded red ribbon.

"There is no law," he shouts. "Shipbreakers are exploiting the workers. The government has no role."

A sampling of his clients' cases shows how sluggish the legal system can be. There's Shantaram Sriram Jadav, who fell into the sea while climbing an anchor chain on July 20, 1994. He was presumed drowned. For two years, his widow and four daughters were promised compensation, but got nothing. Finally, they asked Thakkar to sue, seeking $8,500, but they have not been able to raise the $17 filing fee.

There's Birbal Mahato, who was asphyxiated Sept. 17, 1993, by a gas leak. Thakkar won the case, but has been unable to collect damages of $4,500. The shipbreaker has offered to settle for less.

And there's Ram Nagina Toofani, who was burned to death on March 10, 1991. A suit filed July 22, 1991, has gone nowhere.

"Sometimes, I feel very frustrated," Thakkar says. "But I will continue my fight relentlessly."

On occasion, the state Labor Commission brings an action in criminal court when a worker dies.

"I can tell you no accident will go unpunished," says R.S. Vaghela, the labor commissioner. But not a single case, going back at least to 1989, has been resolved. No shipbreaker has ever been convicted.

The owners of the scrapyards operate with impunity. But they are a product of the system, not the creators of it. India rewards those who help themselves. "Naturally, the shipbreakers want to put labor into a better position," says H.K. Agrawal, one of the most prominent scrapyard owners in India.

Conditions are poor, he concedes. "But 15 years ago there was nothing. In my eyes, a lot has been done here. I tell you why I like this business -- I create jobs for 200 to 300 people and I run it like a family. If I do something like that, then I'm sure I'm getting some profit also."

The problems, he says, lie with the Gujarat Maritime Board. It is the responsibility of the board to worry about housing and sanitation. The shipbreakers donated about $300,000 for housing to the board, and no one knows what has become of the money. The head of the local Maritime Board office, Agrawal complains, only gets in the way.

The accidents are regrettable, he says.

"But the worker knows, 'If I die, my family gets the money,'" he says. "This is in his mind. He tends to take risks, which he should not. Most accidents occur because workers are very keen to please the owners, and they are so loyal to the owners they want to finish the work quickly. This is the good side and the bad side."

Agrawal says he once worked in the yard himself, when his father ran it. "I have seen the ups and downs of life," he says. "There was a time in my life when I did not have enough for two square meals. I feel for the downtrodden." Clad in raw silk pajamas with gold buttons, Agrawal had welcomed a group of American visitors to his home in Bhavnagar. As celebrants blew horns and set off firecrackers beyond his garden wall -- it was marriage season in Gujarat -- private security guards lingered nearby.

His contemporary home sprawls: The black-and-white marble floor of Agrawal's living room was large enough to accommodate at least eight of his laborers' shacks in Alang.

Virtually all the owners at Alang are self-made men, and they want the world to know it.

'Maharajah style'

"They like the flamboyant and a little bit of show," says Zarine Khan, a high-society Bombay interior decorator who has worked for about a dozen shipbreakers in Bhavnagar. "I'm catering to their tastes, and their tastes are pretty loud."

They like a lot of marble, she says, and paint over expensive rosewood furniture to make it showier. Khan says the shipbreakers aspire to a "maharajah style." When she completed Agrawal's house several years ago, he threw a party for himself and invited 1,000 people.

Agrawal, in his mansion, and the hundreds of men who work for him, in their shacks, are a long way from Ahmedabad, the capital of Gujarat -- at least a six-hour drive over poor roads. Officials with the state labor commission there speak of conditions at Alang with certainty. They point to nine pages of detailed safety rules about shipbreaking. That the rules are unenforced was, apparently, beside the point.

But their boss, the commissioner, Vaghela, acknowledges that life and work at Alang could be better.

He talks about the jobs created and steel produced by the shipbreakers. (Shipbreaking accounts for about 7 percent of India's steel production, according to the steel ministry in New Delhi.) But he also talks about the health and safety problems at Alang. There are no death certificates issued when workers die of illness or are killed, and no single government agency believes itself to be responsible for conditions there.

There is, he says, one thing that the developed countries have a moral responsibility to do: Rid their ships of hazardous materials before sending them to India.

"Your country can afford all of this," he says. "It is a small thing they can do."

Is shipbreaking a net plus or minus for India? "Don't ask these questions," Vaghela says, shaking his head. "Only developing countries are doing this job. They need money." A worker's end

It is late morning and the laborers at Plot 37 have gathered outside the gate. Each man holds a plank on his shoulder. They begin walking, falling into a procession down the street, past the yards. They carry the boards like peasants with pitchforks, or soldiers with rifles. Others turn to watch, though they've seen this before.

A hundred men, swelling to 200, move determinedly down the street, quiet at first. Then the chanting begins. "Ram, nam, satya hai."

The Name of the Lord is the Truth.

At the front, wrapped in an orange shroud, they carry the body of Shahade Ram, 35, who had worked here five years. He had complained of a cough and chest pain. A self-styled doctor told him he would be fine and gave him a glucose injection. At 1 a.m. he had died in his hut. That was nine hours ago.

The men come to the place where Alang creek cuts through the dunes and enters the Bay of Cambray. Below the tide line, a small corral of timbers is driven into the sand. Inside it, the wood the men have been carrying is piled four feet high.

Traditionally, a body is burned with sandalwood, but here the men must use scrap lumber scavenged from the ships. There is no priest for a proper Hindu funeral, so a man who knows the ritual leads the ceremony, along with Ram's brother.

The body is placed on the pile. More boards are put on top, and large timbers are leaned against the pyre.

The smell of incense overpowers the smell of excrement (here, below the high-tide mark, is where the men come to defecate) and the acrid smell of smoke from the nearby plots.

There is a brief distraction: A fire at a plot 200 yards away has sent workers running in all directions. It ends with the concussive explosion of an oxygen canister.

Seven men walk around the pyre, chanting, "Ram, nam, satya hai," and lighting the fire with burning bundles of reeds.

Bright orange flames leap from the pyre, and the men back away from the heat. A few leave. One rings a bicycle bell as he walks away.

The fire burns for a long time, until finally the tide comes in, washing away what little remains of Shahade Ram.

Sun researchers Jean L. Packard, Robert Schrott and Paul McCardell contributed to this series.

© 1997, The Baltimore Sun

By Will Englund and Gary Cohn

Sun Staff

ALANG, India -- The last voyage of the Nikolai Pogodin, a Russian freighter plagued by debt and barnacles, ended in the hopeless hour before dawn on the beach at Plot No. 20.

The lights of the Pogodin glimmered out in the bay, seeming for a long time not to be moving -- but only because the ship was charging out of the dark night toward the beach at Alang. As it came closer, the outline of the hull became visible, set off by the white foam at the bow.

Beaching a ship is a ticklish business. The current runs strong. Kenneth Pereira, the Alang pilot, once had a ship's wheel come off in his hands during a beaching. The shipbreaking plots are narrow, and the water offshore is littered with parts of vessels.

The throbbing of the Pogodin's engines reached the shore. And then the ship rose at the last moment. Its bow lifted toward men gathered on the beach, feeding a fire with scraps of rubber. In a single, easy motion, the ship came to a stop.

The Pogodin dropped anchor for the last time.

"It's a good ship," said Capt. Leonid Baturevich, "but it's 26 years old. That's too old. It's getting dangerous."

The ship was dark and now belonged to Chetan Tamboli, owner of Plot 20. He sent his men aboard, and news came back that, unbelievably, the Russians had left 150 bottles of gin and vodka on board. Tamboli and the others were ecstatic. Alang is in Gujarat, a dry state, yet the owners of the shipbreaking companies are a notoriously hard-drinking lot. This was like a gift from heaven.

© 1997, The Baltimore Sun

By Gary Cohn and Will Englund

Sun Staff

Citing threats to workers' safety and the environment, Sen. Barbara A. Mikulski called yesterday for a review of the Navy's troubled ship-scrapping program and requested that the Defense Department suspend a plan to send warships overseas for disposal.

Mikulski's request to the Defense Department came after a series of articles this week in The Sun documented how the scrapping program has harmed workers and polluted waters at ports around the country, including Baltimore.

Mikulski also called for the Senate Armed Services Committee to hold hearings on the program.

"I am appalled by the conditions described in the articles and the threats they present to worker health and safety, the environment and the communities surrounding shipyards," the Maryland Democrat said in a letter to Republican Sen. Strom Thurmond of South Carolina, chairman of the Armed Services Committee.

Rear Adm. Kendell Pease, chief of the Navy's information office, said that the Navy welcomes discussions "to ensure the complex process of ship disposal is conducted in an environmentally sound manner and in a way that protects the health and safety of workers."

A spokeswoman at the Defense Reutilization and Marketing Service, the Pentagon agency that administers the scrapping program, did not return phone calls yesterday.

In its three-part series, The Sun described deaths, accidents, fires, oil spills and mishandling of asbestos in the scrapping industry in the United States and in India, the world's leading shipbreaking nation.

American yards, dependent on low-paid Mexican immigrant laborers, have sprung up in struggling ports from Baltimore to Brownsville, Texas, since the Navy began selling off ships at the end of the Cold War.

The articles reported that the Navy and the Defense Department make no serious effort to oversee the scrapping, even though the Navy retains ownership of the vessels. Until recently, only one inspector with little training and experience kept watch on scrapping operations for the entire country.

One of the main findings in the series was that laborers have been working in air thick with asbestos dust. In Baltimore, for example, workers scrapping the USS Coral Sea ripped asbestos insulation from the aircraft carrier with their bare hands. At times they had no respirators, standard equipment for asbestos work.

"We know asbestos is a killer," Mikulski said in an interview. "It's not like this is an unknown particle. The mishandling of asbestos seems to be a pattern through all of this."

Mikulski also raised concerns about the Navy's plan to begin exporting ships to South Asia for dismantling, where working conditions are extremely dangerous and environmental regulations virtually nonexistent. The Sun articles described the disabling accidents, disease and deaths that characterize the shipbreaking plots along six miles of foul beachfront at Alang, India.

With its domestic program in disarray, the Navy has recently obtained an exemption from the Environmental Protection Agency that would allow the sale of its ships abroad. Such sales would normally be prohibited by the Toxic Substances Control Act because of PCB-containing materials that are on board every ship.

PCBs, or polychlorinated biphenyls, were used extensively for 50 years in electrical insulation, in air system gaskets and fluorescent light fixtures. They have been linked to cancer, liver and skin disease, and developmental problems in infants.

The exemption requires that the most accessible PCB materials be removed before export, but thousands of other contaminated items would remain on board. It would permit Navy ships to join the hundreds of other vessels from around the world that are scrapped every year on forlorn beaches in India, Pakistan and Bangladesh.

Mikulski said the Defense Department must ensure that its ships are scrapped in a responsible manner.

"Let's see if we can't either shut it down or clean it up," Mikulski said of the scrapping program.

© 1997, The Baltimore Sun

By Will Englund and Gary Cohn

Sun Staff

WASHINGTON -- Navy and Defense Department officials defended their troubled ship-scrapping program yesterday and said they plan to sell 25 more ships for scrap in early 1998.

While acknowledging that the program has had serious problems with pollution and injuries to workers over the past six years, they said that bidding procedures adopted a year ago will weed out unqualified shipbreakers.

"This is a developing industry," said Jesse A. Atkins, deputy commander of surface ships for the Navy. "As it goes on, we will find out how viable this is. I think we have to give the process we have in place an opportunity to work."

Jeffrey A. Jones, principal executive director of the Defense Logistics Agency, which handles ship sales for the Navy, said it would deal from now on only with reputable companies. "We won't contract with anyone else," he said.

Atkins and Jones, interviewed jointly yesterday, made the first detailed public remarks by Defense Department officials about the ship-scrapping program since a series of articles documenting the industry's problems was published in The Sun last week. The articles described deaths, accidents, fires, oil spills and mishandling of asbestos in the scrapping industry in the United States.

The Defense Department has repeatedly sent ships to scrappers with records of bankruptcies, fraud, payoffs of government inspectors and environmental and safety violations.

The articles also looked at India, the world's leading shipbreaking nation, where working conditions are extremely dangerous and regulation virtually nonexistent.

Atkins said a Navy plan to export ships for scrap to South Asia is only under consideration. "No decision has been made to go," he said. "We're not there yet."

He said the Navy was concerned about the flawed scrapping projects at ports across the United States. "It hasn't worked really well, and we realized that," Atkins said.

But he and Jones said the problems in the domestic program had been addressed in 1996 by tightening procedures to qualify potential scrappers.

Scrapyards have to describe how they plan to break up a ship, how they will dispose of hazardous substances, how they will comply with health and safety requirements, and show that they have the financial ability to complete a scrapping project.

Atkins and Jones said they were convinced that a shipbreaker could pay the government for a ship, follow environmental and safety laws in breaking it up, and still make a profit.

Critics of the program disagreed yesterday.

E. Grey Lewis, a former Navy general counsel, has made a study of the shipbreaking program and believes that the Navy will have to subsidize the disposal of its ships.

"It's my opinion they still haven't stepped up to the plate yet," Lewis said yesterday. "No one can make any money out of this."

Eve Bach, of a San Francisco environmental group, said that scrapping Navy ships -- laden with asbestos, PCBs and other hazardous materials -- can't be done both properly and profitably. "I think it's an inadequate response saying they are going to choose more carefully, because basically it's not a viable business," she said.

"Hoping you can find someone who can do it under the present set of rules and follow all the applicable environment and worker safety rules is whistling in the dark. It fails to take into account that the structure of the program doesn't work."

James Moorman, a former assistant U.S. attorney general who is now an environmental lawyer in Washington, said the Navy needs to rethink its whole approach.

"The problem seems to be that the Navy is trying to make money by selling these ships instead of viewing the ships as a problem it has to spend money to take care of," he said. "What else does the Navy try to make money off? Why try to make money off an environmental problem? I don't get it."

The Navy's ship-scrapping program is connected to several Defense Department agencies. Jones works for the Defense Logistics Agency, which oversees the Defense Reutilization and Marketing Service, or DRMS, an agency based in Battle Creek, Mich., which administers the program.

Atkins works for the Naval Sea Systems Command, which oversees surface ships. At yesterday's interview, Jones and Atkins were accompanied by nine aides, lawyers and observers from other agencies.

DRMS was set up to sell surplus equipment -- boots, hats, desks, lamps. Its experience is in sales and not in contract monitoring. Jones expressed confidence in the agency's ability to run the program, although he noted that ships are not like other equipment.

"These are small cities we are disposing of," he said. "Complicated commodities -- they go beyond commodities."

The 25 ships that are scheduled to be sold will be put up for bid within the next 60 days, Jones said. They will be sold in two groups -- one on each coast. Jones said he believes that scrapyards can benefit from handling a stream of ships, sold in larger groups than previously. Experience, efficiency and stable labor costs should contribute to profitability, he said.

Jones said he was confident that reputable businesses would bid on the ships and that sites could be found for doing the work, despite the serious environmental problems that have occurred in ports around the country.

"It's the quality of the proposal [from potential bidders] that's going to make a difference," he said.

Until recently, the Navy had insisted that its ships be scrapped in the United States whenever possible. But now the Navy is seriously considering the sales of its ships abroad instead. This summer, the Navy reached an agreement with the Environmental Protection Agency that would exempt the service from a law banning the export of certain hazardous materials found on ships.

Jones said the Defense Department is now weighing what steps it could take to protect the health and safety of workers in shipbreaking yards overseas. "I don't think we can say right now," he said. "There's no simple answer."

Any measures, he said, would not be up to American standards, "but to standards that would be acceptable."

Sen. Barbara A. Mikulski, citing the scrapping program's dismal safety and environmental record, called last week for a Defense Department review of the program and hearings by the Senate Armed Services Committee.

© 1997, The Baltimore Sun

By Gary Cohn and Will Englund

Sun Staff

"Maximizing the profits from vessel scrapping is not sufficient justification for the United States exporting toxic wastes to countries not equipped to dispose of them properly," Miller said in his letter to Dalton.

The Navy's troubled ship-scrapping program and its plan to sell warships abroad came under attack yesterday from members of Congress and several environmental organizations.

Critics demanded that the Navy and Defense Department justify a program that has run into serious environmental and safety problems at yards around the country. They objected to the only alternative the Navy has offered -- sales of ships, laden with hazardous materials, to Third World scrapyards, where worker protection is minimal and pollution routine.

"I find it unconscionable that the United States would bend its own environmental laws, exporting a serious environmental and worker safety problem along with these vessels, merely for the sake of expediency," said Rep. George Miller, a California Democrat.

In letters to several government agencies, Miller cited a series of articles published last week in The Sun that described the deaths, injuries, accidents, fires and mishandling of asbestos in shipbreaking yards.

Rep. Wayne T. Gilchrest, a Maryland Republican, said last night that a subcommittee he heads would hold hearings on the ship-scrapping program.

Beginning in February, Gilchrest said, the Coast Guard and Maritime Transportation subcommittee would look into the environmental, health and safety problems linked to the transient shipbreaking industry.

Defense Department and Navy officials defended the program this week, declaring that they had tightened bidding procedures to weed out disreputable contractors and had improved the monitoring of scrapyards.

Those remarks brought renewed criticism from Sen. Barbara A. Mikulski.

"Frankly, I was disappointed in their tepid comments," the Maryland Democrat wrote to Defense Secretary William S. Cohen. "We don't need hollow promises and cliches. We need an action plan and concrete solutions."

Spokesmen for the Navy and the Defense Logistics Agency, which handles the sale of ships for scrap, said they were not prepared to comment on Mikulski's letter.

Miller said his House committee had devoted years to the problems of shipyard workers from an earlier generation who were exposed to asbestos while building Navy ships.

"I am frankly distressed to learn that many of the same kinds of hazardous conditions we investigated at that time are apparently frequently present in shipyards where government ships are being broken down," he wrote to John H. Dalton, secretary of the Navy.

Much of the congressional comment centered on the Navy's consideration of a plan to sell its obsolete ships to yards in South Asia. Most overseas shipbreaking is done on beachfront plots in India, Pakistan and Bangladesh.

In Alang, India, the largest shipbreaking center in the world, 35,000 men work and live in wretched conditions. Death by accident and disease is an everyday occurrence.

Proponents of the export plan have pointed out that the U.S. government could receive more money for its ships; unregulated foreign yards have much lower costs.

"Maximizing the profits from vessel scrapping is not sufficient justification for the United States exporting toxic wastes to countries not equipped to dispose of them properly," Miller said in his letter to Dalton.

The Environmental Protection Agency signed an agreement with the Navy last summer that would lift a ban on the export of warships, which was put in place because of PCB-containing materials on board.

PCBs, or polychlorinated biphenyls, were used extensively for 50 years in electrical insulation, in air system gaskets and fluorescent light fixtures. They have been linked to cancer, liver and skin disease, and developmental problems in infants.

Under the agreement, the most accessible PCB-bearing materials would be removed, but others could remain on the ships. Although it pushed hard for that agreement, the Navy has not moved to carry out the plan.

Sen. John Glenn, an Ohio Democrat, expressed concerns about the agreement.

"I don't like the way it was done," he said. "The rule-making process is there for a good reason, to let all the interested parties comment and make sure safety is paramount. And yet they went ahead and changed the way of doing business.

"That's not right. That's not taking the safety or workers here or abroad into account."

Steven Herman, the EPA's assistant administrator for enforcement, defended the agreement. He said the agency required the removal of the most hazardous PCBs before export as well as notification to the countries where the ships would be sent.

"Our moral responsibility is to do as much as we can to try and protect people's health and safety," he said. "On the other hand, we can't control what other countries do. Even if we wanted to, it's not possible."

But environmental groups dismissed such arguments.

"I think it's a classic case of toxic colonialism," said Joshua Karliner, executive director of the Transnational Resource and Action Center, a nonprofit group in San Francisco.

The export of Navy ships, he said, "is basically taking a toxic-laden hulk of waste and finding the cheapest and least-regulated way to dispose of it, and saying the hell with the social and environmental consequences of what we're doing."

Michael McCloskey, chairman of the Sierra Club, said he was particularly alarmed about shipping PCBs abroad.

"I think the United States has a clear responsibility there," he said, although he hasn't seen the particulars of the agreement. "If the United States manufactures them and they are now in the United States, we should take care of them."

Polly Parks, a military environmental consultant in Washington, said sales of ships to South Asia could create a political and economic liability for the United States.

"I mean, good grief, they're sending over ships that have asbestos in them?" she said. "If we have a work force in this country that can do the job, and we have standards, we have a responsibility to do the job ourselves."

© 1997, The Baltimore Sun

By Gary Cohn and Will Englund

Sun Staff

Navy Secretary John H. Dalton has suspended a controversial proposal to send warships overseas for disposal, a plan that had come under increasing fire from members of Congress and environmental organizations.

Capt. Craig Quigley, a spokesman for Dalton, said the secretary has ordered the Navy to immediately suspend consideration of sending ships overseas. Dalton also directed subordinates to work with the Defense Logistics Agency, which handles the sale of ships for scrap, to evaluate the Navy scrapping program in the United States before considering sending ships abroad.

Dalton's action came after a series of articles this month in The Sun documented how the Navy's troubled ship-scrapping program has harmed workers and polluted waters at ports around the country. The articles also described a Navy proposal to sell warships, laden with hazardous materials, to Third World scrapyards, where worker protection is minimal and pollution routine.

"Basically, he [Dalton] said let's just hold off on taking a look at overseas options until taking a look further at options in the United States," Quigley said. "He is concerned and wants to do this right, in accordance with all applicable laws, budgetary restraints and common sense."

Sen. Barbara A. Mikulski of Maryland said yesterday that she was relieved that the Navy had dropped the idea of exporting its vessels. But she cautioned that that alone was not enough.

"This action is a very important and much-needed first step," Mikulski said. "But it cannot be the only step. The Navy must develop a plan that saves communities at home, saves our workers' lives and saves the environment."

In its series, The Sun described deaths, accidents, fires, oil spills and mishandling of asbestos in the scrapping industry in the United States and in India, the world's pre-eminent shipbreaking nation.

Since the articles appeared, members of Congress and environmental groups have attacked the Navy's plan to sell its obsolete ships to yards in South Asia. Most overseas shipbreaking is done on beachfront plots in India, Pakistan and Bangladesh.

In Alang, India, the world's largest shipbreaking site, 35,000 men live and work in wretched conditions. Death by accident and disease is an everyday occurrence.

Critics on Capitol Hill have objected to exporting the ships, which they describe as an expedient but unacceptable solution to a U.S. environmental and worker safety problem. Rep. Wayne T. Gilchrest, a Maryland Republican, plans to hold hearings on the ship-scrapping program beginning in February. And leaders of environmental groups, including the Sierra Club, said the Navy would be abdicating its responsibility by scrapping ships containing hazardous materials overseas.

Proponents have pointed out that the U.S. government could receive more money for its ships if it sold them abroad; unregulated foreign yards have much lower costs.

The Navy negotiated an agreement last summer with the Environmental Protection Agency that would lift a ban on the export of warships, enacted because of PCB-containing materials on board. PCBs, or polychlorinated biphenyls, were widely used for 50 years in electrical insulation, air system gaskets and fluorescent light fixtures. They have been linked to cancer, liver and skin disease, and developmental problems in infants.

Under the agreement, the most accessible PCB-bearing materials would be removed, but others could remain on the ships. Although the service pushed hard for that agreement, Navy officials said last week that the proposal to export ships for scrapping was only under consideration.

Steven Herman, the EPA's assistant administrator for enforcement, has defended the agreement. He said it requires the removal of the most hazardous PCBs before export and notification to the countries where the ships would be sent.

The Navy began considering the overseas option after the domestic scrapping program became plagued with problems. The Defense Department has been selling ships for scrapping to private contractors at ports across the United States since 1991, when it began downsizing at the end of the Cold War. But the Defense Department has repeatedly sent ships to scrappers with records of bankruptcies, fraud, payoffs to government inspectors, and environmental and safety violations.

Industry experts have said the program is fundamentally flawed: A warship can't be scrapped properly and profitably because the safe removal of hazardous materials is expensive. Those willing to do the work often are inexperienced or willing to cut corners.

Defense Department and Navy officials defended the program last week, declaring that they had tightened bidding procedures to weed out disreputable contractors and had improved the monitoring of scrapyards.

Critics have said the Navy should overhaul the program, instead of tinkering with its parts. They have suggested that the Navy pay contractors for scrapping, do the work itself in Navy yards or remove hazardous materials before turning vessels over to scrapyards.

© 1997, The Baltimore Sun

By Gary Cohn

Sun Staff

WASHINGTON -- Sen. Barbara A. Mikulski called yesterday for reform of the Navy's troubled ship-scrapping program and suggested that obsolete ships be dismantled in the nation's established shipyards, including Baltimore's Sparrows Point.

"I think we ought to take a look at how we can turn this into an opportunity for jobs in our shipyards," the Maryland Democrat told a Defense Department panel studying how to scrap Navy ships safely. "We can use the very same set of skills needed to build ships. Our shipyards are foraging for work."

Mikulski was one of more than a dozen people, including shipscrappers and environmentalists, who spoke to the panel yesterday at a public hearing.

The shipbreaking industry is under mounting pressure from lawmakers and environmentalists to comply with anti-pollution and worker-safety laws.

The scrutiny follows a series of articles in The Sun in December that documented the industry's record of deaths, accidents, fires, mishandling of asbestos and environmental violations at ports around the country. The articles also reported that the Navy and Defense Department make no serious effort to oversee the scrapping.

One of the most significant issues being addressed by the panel is whether U.S. government ships should be scrapped in the Third World, where worker safety and environmental regulations are virtually nonexistent.

The Navy and the Maritime Administration, which together have about 170 ships designated for scrapping, have suspended the controversial export plan.

Michael Deal, of Resource Recovery International Group Inc., a Washington state company involved in scrapping, told the panel yesterday that he favors sending the ships overseas. Deal said the U.S. government would receive more money for its ships by selling them abroad and that environmental concerns could be adequately addressed in foreign scrapyards.

"We argue for a responsible export program," Deal said.

Not overseas

But Ross Vincent, a Sierra Club representative, told the panel that the ships should be scrapped in the United States, not overseas.

"Waste should be dealt with where it is generated," he said. "U.S. vessels should be scrapped in U.S. facilities or perhaps others nearby -- not halfway around the globe."

And in a written statement issued to the panel, Rep. George Miller, a California Democrat, said: "A global environmental leader like the United States should not have, as a national policy, the exporting of its toxic waste to developing countries ill-equipped to handle it."

Most shipbreaking overseas is done on beachfront plots in India, Pakistan and Bangladesh. In Alang, India, the largest shipbreaking center in the world, 35,000 men work and live in wretched conditions. Death by accident and disease is an everyday occurrence.

The Defense Department panel is to present its findings by March 31. A congressional hearing is scheduled March 18 before the House Subcommittee on Coast Guard and Maritime Transportation.

Mikulski told the panel that the Defense Department should rethink its approach to shipbreaking.

Since 1991, as the Navy has downsized, the Defense Department has sold its old warships to private contractors, who have tried to make a profit by selling metal salvaged from the ships. But many contractors cut corners, leading to worker-safety and environmental violations.

"For every worker injury and for every environmental pollution, we have to pay for either cleanup or health care," Mikulski said in an interview. "There is no way to do this on the cheap. By putting it out into an American shipyard, we can do it quicker, and I believe we'll do it in a way that is better for the workers."

Stephen Sullivan, vice president of human resources for Baltimore Marine Industries Inc., told the panel that Navy ships could be scrapped at the Sparrows Point yard. Baltimore Marine Industries succeeded Bethlehem Steel Corp. as the yard's owner last year.

Singular expertise

"We have a singular combination of shipbuilding, ship conversion and ship repair expertise, facilities more than adequate to support a shipbreaking program, and a highly motivated work force that has just seen its source of livelihood rescued from the brink of oblivion," Sullivan said.

Murphy Thornton, president of Local Lodge S-33 of the Industrial Union of Marine and Shipbuilding Workers of America, expressed interest in scrapping government ships at Baltimore Marine Industries.

The yard, which once built ships, turned to repairing them to survive as shipbuilding moved overseas. He said the work force of 500 people has the skills required for breaking ships.

"We've put bottoms on ships, we've added deckhouses, we've taken down deckhouses," Thorton said. "We've taken out the midsection of ships to put new ones in. We've cut ships in two."

Thornton said some of the ships being scrapped were built at the historic yard.

"Those ships should be buried with honor and buried correctly," he said.

Sun staff writer Sean Somerville contributed to this article.

© 1997, The Baltimore Sun

By Gary Cohn

Sun Staff

• Defense committee to review Navy's scrapping program

• Called 'a positive step'

• Agencies to decide how best to dispose of surplus vessels

The Department of Defense is creating a high-level panel to review the Navy's troubled ship-scrapping program, which has harmed workers and polluted waters at ports around the country.

The panel, which will be headed by a senior Defense Department official and include representatives from at least six government agencies, is expected to examine a broad range of safety, environmental and public policy issues and make recommendations in 60 days on reforming the program.

"Ships are very complex systems and we want to ensure we scrap these vessels in an environmentally sound, safe, affordable and commercially feasible way," said Patricia A. Rivers, who is heading the panel. Rivers is responsible for developing environmental cleanup policy for the Defense Department worldwide.

The appointment of the panel comes amid increasing criticism of the Navy's scrapping program from members of Congress and environmentalists. It follows a series of articles last month in The Sun that documented how the scrapping industry has left a dismal record of deaths, accidents, fires, mishandling of asbestos and environmental violations wherever it goes.

The committee was set up by Jacques S. Gansler, the undersecretary of defense for acquisition and technology. It will include representatives from the Navy, Defense Logistics Agency, Maritime Administration, Environmental Protection Agency, Occupational Safety and Health Administration and State Department. The group is expected to conduct its first meeting next week.

Members of Congress reacted favorably yesterday to the creation of the review panel.

"This panel is a positive step in correcting the shipbreaking problems," said Sen. Barbara A. Mikulski, a Maryland Democrat who has criticized the scrapping program. "The agencies need to communicate, cooperate and coordinate. They need to come up with concrete steps to make sure the problems of the past aren't repeated."

A spokeswoman for Rep. Wayne T. Gilchrest, said the Maryland Republican was pleased that the Defense Department has set up the panel. Gilchrest has said that a subcommittee he heads would conduct hearings on the ship-scrapping program early this year. The congressman plans to go ahead with the hearings, his spokeswoman said.

Since 1991, as the Navy downsized, the Defense Department sold its old warships to private contractors, who would try to make a profit by selling metal salvaged from the ships. But many contractors cut corners, leading to serious worker safety abuses and environmental violations at U.S. ports, including Baltimore.

Officials of the Navy and Defense Logistics Agency, which handles ship sales for the Navy, have acknowledged that the scrapping program has been flawed, but said they had tightened bidding procedures in 1996 to weed out unqualified contractors. They said they were convinced that a scrapper could buy a ship, follow environmental and safety laws in breaking it up, and still make a profit.

But critics contend that the Navy and Defense Department need to rethink their approach. They say the Navy should subsidize the disposal of its obsolete ships, instead of making money from them.

Rep. George Miller, a California Democrat, wrote to House members last week, arguing that the Defense Department has long accepted that it has to pay environmental cleanup costs related to closing bases. He argued that the downsizing of the fleet should be treated no differently.

One of the most significant issues to be addressed by the panel is whether U.S. warships should be scrapped in the Third World, where worker safety and environmental regulations are virtually nonexistent. Last month, Navy Secretary John H. Dalton suspended a controversial proposal to send warships overseas for disposal; the plan had come under increasing fire from members of Congress and environmentalists.

"What I think the panel can do is explore the question of whether ship scrapping abroad can be done in an environmentally sound, safe, affordable and commercially feasible way," said Rivers, the assistant deputy undersecretary of defense for cleanup.

"I know the Navy has vessels that have to be disposed of," said Rivers. "I believe our panel will establish a charter that will look at how these ships can best be disposed of both inside and outside the United States."

© 1997, The Baltimore Sun